{"id":2407,"date":"2020-11-16T07:33:23","date_gmt":"2020-11-16T07:33:23","guid":{"rendered":"https:\/\/trustply.com\/blog\/?p=2407"},"modified":"2021-12-08T10:48:45","modified_gmt":"2021-12-08T10:48:45","slug":"tips","status":"publish","type":"post","link":"https:\/\/trustply.com\/blog\/money-exchange-and-transfer\/tips\/","title":{"rendered":"Essential things you need to know about money transfer and money exchange"},"content":{"rendered":"

There are a lot many reasons why people communicate or travel internationally; They do so for business, for pleasure, for work, for education, etc. Likewise, there are many reasons why they may get in trouble as they want to make such communication, travel abroad or while they are staying in another country. one of the most common and most urgent of such troubles is, for sure, how to exchange or transfer money in the easiest, safest, fastest and cheapest ways possible.<\/span><\/p>\n

In this article, we provide you with essential things you might need to know about money transfer and money exchange, including why they are important in today\u2019s world, how they are usually done worldwide and what could be mentioned as the commonest problems and challenges that people doing money transfer and money exchange face with. Later, we explain peer to peer payment services that are easier, safer, faster and cheaper ways of doing money transfer and money exchange. Read this article to the end, we have good news for you!<\/span><\/p>\n\n

With the rapid development of communication technology, the world has indeed turned into a global village where people can easily communicate with one another and use such communications to fulfill their needs much better today than yesterday. And in such an interconnected world, one vital thing that is very much required to maintain and extend communications is <\/span>money<\/b>.<\/span><\/p>\n

Like it or not, money is the commonest means of payment for goods and services all around the world. It is a crucial factor without which modern complex economic organization is almost close to impossible. Therefore, exchanging and transferring money from one country to another have gained crucial importance during recent decades.<\/span><\/p>\n

How are money transfer and money exchange usually done?<\/b><\/h2>\n

Money exchange and money transfer are done every day, every hour, every minute and every second for a variety of reasons among a variety of persons worldwide, be it real or legal. They exchange and transfer money for buying or selling overseas property, paying for overseas tuition fees, investing overseas, sending money to friends or family who live overseas, and many more other reasons.<\/span><\/p>\n

Today\u2019s digital banking is so well-developed that you can transfer and exchange money from wherever you are to wherever you want, all in a matter of minutes. There are even many online applications you can install in your mobile phone, by the use of which you can make international money transfers and exchange multiple currencies 24\/7 without having to leave your home.<\/span><\/p>\n

Four common online platforms for money transfer<\/b><\/h2>\n

For the purpose of saving time and money, and to avoid safety concerns, old methods of money transfer such as using cash, check, bank draft, or money order are getting less and less popular when there are easier, faster, more economical still safe electronic methods for transferring money between accounts, states, and even countries. If you ever send money abroad, you might have heard about one of the following cashless and online platforms:<\/span><\/p>\n

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1. Western Union<\/b><\/h3>\n

This American company of international money transfer services is an old one and was founded in 1851, but it is still very popular. The company offers person-to-person money transfer, money orders, business payments, and commercial services.<\/span><\/p>\n

Western Union<\/a> gives access to users through its website and it also has a mobile application that allows you to send money easily to more than 500,000 agent locations in over 200 countries<\/strong> and territories.<\/span><\/p>\n

This platform, however, is not tax-free and will charge you fees, which will be determined based on the speed of the transfer you like, the location you want to send the money as well as the amount of money being sent. <\/span>Based on the amount of money, for example, Western Union charges $5<\/strong> for a money transfer of up to $50<\/strong>, and a transfer of $900<\/strong> could cost a fee of $76<\/strong>. <\/span>A slow delivery is another weak point for Western Union (usually four to five days).<\/span><\/p>\n

There are also specific money transfer limits using Western Union which vary based on a number of factors, including your transfer history, your location, your receiver\u2019s location, the service you choose, your payment method, agent location limits and country receive limits.<\/span><\/p>\n

Back in October 2007, the Western Unioncompany announced a new plan which was to introduce a mobile money transfer service with the Global System for Mobile Communications Association (GSM). GSM is a global trade association that represents well over 700 mobile operators in 218 countries worldwide and is so extensive that it has more than two and a half billion subscribers [<\/span>Wikipedia<\/span><\/a>].<\/span><\/p>\n

2. PayPal<\/b><\/h3>\n

PayPal<\/a> is another online payment system that was founded in the United States back in 1998. It provides its users, individuals and businesses around the world, to receive or send money online.<\/span><\/p>\n

Using the PayPal platform, it’s free to send money, however, the recipient has to pay tax and is charged a fee to cash the payment. For transfers up to $3,000, the charge is 2.9%, plus $0.30 per transaction<\/strong>.<\/span><\/p>\n

What is interesting about PayPal is that there are no fees for sending money to friends or family members, but under the condition that the money is coming from a bank account linked to a PayPal account not a credit card<\/a>. If you use a credit card for doing so, then you’ll have to pay whatever fees your issuer charges you. PayPal is very much mobile friendly.<\/span><\/p>\n

It has a mobile application which is super easy to use. You can shop, withdraw and send money, anywhere at any time. PayPal\u2019s algorithm, however, can sometimes detect suspicious behaviors in your account and then automatically freeze your account, without warning.<\/span> In addition, some banks may charge you with transaction fees when you transfer money from your PayPal account to your bank account. <\/span><\/p>\n

The platform requires one to four days of your time to do your money transaction depending on the amount of the money and the distance where you want to send or receive that amount.<\/span><\/p>\n

As of 2020, PayPal is operating in 202 markets and has 305 million active, registered accounts. This platform provides its customers with services such as the possibility of holding, receiving or sending money in 25 different currencies worldwide. <\/span><\/p>\n

The company introduced a new service on October 21, 2020 that allows customers to use cryptocurrencies for shopping at 26 million merchants on the network<\/a>, which will be available for PayPal users in 2021 [<\/span>Wikipedia<\/span><\/a>].<\/span><\/p>\n

3. OFX<\/b><\/h3>\n

OFX<\/a>, previously known as OzForex is a world class international money transfer service which was founded in 1998 and is based in Australian, but now has offices around the world. <\/span><\/p>\n

This online foreign exchange and payments company offers its services online, in its mobile app or over the phone. Because OFX bases the rate they charge on how often you use the money transfer services, it is an economical option for those who make frequent transfers.<\/span><\/p>\n

Using OFX, you don\u2019t have to be worried about transferring huge amounts of money as there are no maximum transfer limits, on the other hand, there is a minimum transfer limit in OFX, which means you can\u2019t use this platform if you want to send less than $150. <\/span><\/p>\n

OFX has a straight forward fee model. The fee is within the exchange rate offered and can vary according to what currency you are transferring between 0.5% and 0.8%<\/strong> of the transfer amount.<\/span><\/p>\n

There is also an additional fee of $15 when you want to send under CA $10,000 or AUD $10,000 by this platform. <\/span><\/p>\n

For most major currencies, transfers may take 1-2 days (from the time OFX receives your funds). With most exotic currencies, however, this process may take anywhere from 3-5 days.<\/span><\/p>\n

OFX was previously working under the name of \u201cOzForex\u201d,<\/span> which was started by Matthew Gilmour back in 1998. At that time, Gilmour was working at Bankers Trust as the head of foreign exchange. <\/span><\/p>\n

Before changing into OFX in 2015, the OzForex brand itself used to operate a number of different territory specific brands including NZForex, USForex, UKForex, CanadianForex, as well as ClearFX and Tranzfers [<\/span>Wikipedia<\/span><\/a>].<\/span><\/p>\n

4. TransferWise<\/b><\/h3>\n

Founded in 2011, TransferWise<\/a> is an online platform for sending money that offers money transfers internationally. This London-based company helps its users from around the world to receive and send money using actual and fairly up-to-date exchange rates. <\/span><\/p>\n

TransferWise is quite easy to use online and you can also use the mobile app on your smartphone to transfer money. <\/span><\/p>\n

Using TransferWise, you can count on more than 750 currency routes worldwide, among the most popular of which are GBP, USD, EUR, AUD and CAD. This online platform also provides multi-currency accounts.<\/span><\/p>\n

TransferWise could gain a net profit of<\/span> $8 million in the year 2018. The company provides services for over 4 million customers around the world with monthly transfer of around $4 billion [<\/span>Wikipedia<\/span><\/a>].<\/span><\/p>\n

Using this online platform, the money transfer is not for free, however, and you need to pay tax, an extra charge for the transfer. <\/span>The TransferWise fee is worked out as a percentage of the amount you’re sending, which means that The more money you send, the more your transfer costs.<\/span><\/p>\n

If you want to convert a currency using your card, for example, a fee of 0.35%-3%<\/strong> will await you, and for an ATM withdrawal of more than $250 per month you need to pay 2% of the actual amount of money you want to get. <\/span>In addition, it will take one to four days for your money after you transfer it to go directly to the target person\u2019s bank account. <\/span><\/p>\n

You also need to take into account using such a money transfer service that there are limits for how much you can send with TransferWise. They depend on which currencies you send to and from, and how you pay. <\/span><\/p>\n

For example, for US dollar (USD) transfers there are limits as follow:<\/span><\/p>\n